By Nathalie Tadena
CA Inc.'s (CA) fiscal first-quarter earnings climbed 40% as a
tax benefit helped the software maker's results, though
subscription and maintenance revenue fell.
CA makes a wide array of software for mainframe computer systems
and newer hardware, an industry that has faced serious headwinds.
The Islandia, N.Y. company has now reported revenue declines for
five consecutive quarters. CA has blamed challenges in its sales
force along with broader macroeconomic malaise for weakening
earnings estimates and has also acknowledged it needs to do a
better job marketing. In April, CA unveiled plans to cut about
1,200 employees and consolidate development sites to focus on
higher-priority products and streamline its sales force.
For the quarter ended June 30, CA reported a profit of $335
million, or 73 cents a share, up from $240 million, or 51 cents a
share, a year earlier. Excluding stock-based compensation,
amortization and other items, adjusted earnings increased to 78
cents a share from 63 cents. Revenue slipped 1.5% to $1.13
billion.
Analysts polled by Thomson Reuters most recently projected a
per-share profit of 74 cents and revenue of $1.1 billion.
Subscription and maintenance revenue--which makes up the bulk of
the company's top-line--slipped 3.4%. Professional services revenue
advanced 7.7%, while software fees and other revenue increased
12%.
The latest period included a $118 million income tax benefit,
compared with a $130 million tax expense a year earlier.
Total expenses rose 18%. Bookings jumped 49% to $824
billion.
Shares of the company, which reiterated its full-year outlook,
closed at $29.88 and were unchanged after hours. Through the close,
the stock is up 36% since the start of the year.
Write to Nathalie Tadena at nathalie.tadena@dowjones.com
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